While institutions invested in Fortuna Silver Mines Inc. (TSE:FVI) benefited

Key Insights

• Fortuna Silver Mines’ significant individual investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• A total of 25 investors have a majority stake in the company with 30% ownership
• Insiders have sold recently

If you want to know who really controls Fortuna Silver Mines Inc. (TSE:FVI), then you’ll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are individual investors with 60% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Individual investors gained the most after market cap touched CA$1.1b last week, while institutions who own 39% also benefitted.

Let’s take a closer look to see what the different types of shareholders can tell us about Fortuna Silver Mines.

View our latest analysis for Fortuna Silver Mines

What Does The Institutional Ownership Tell Us About Fortuna Silver Mines?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

Fortuna Silver Mines already has institutions on the share registry. Indeed, they own a respectable stake in the company. This suggests some credibility amongst professional investors. But we can’t rely on that fact alone since institutions make bad investments sometimes, just like everyone does. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It’s therefore worth looking at Fortuna Silver Mines’ earnings history below. Of course, the future is what really matters.

Fortuna Silver Mines is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is Van Eck Associates Corporation with 11% of shares outstanding. Mirae Asset Global Investments Co., Ltd. is the second largest shareholder owning 2.5% of common stock, and Pine Valley Investments Limited Liability Company holds about 1.6% of the company stock. Additionally, the company’s CEO Jorge Ganoza Durant directly holds 0.6% of the total shares outstanding.

On studying our ownership data, we found that 25 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.

Researching institutional ownership is a good way to gauge and filter a stock’s expected performance. The same can be achieved by studying analyst sentiments. There is some analyst coverage of the stock, but it could still become more well known, with time.

Insider Ownership Of Fortuna Silver Mines

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

We can see that insiders own shares in Fortuna Silver Mines Inc.. As individuals, the insiders collectively own CA$12m worth of the CA$1.1b company. Some would say this shows alignment of interests between shareholders and the board. But it might be worth checking if those insiders have been selling.

General Public Ownership

The general public, mostly comprising of individual investors, collectively holds 60% of Fortuna Silver Mines shares. With this amount of ownership, retail investors can collectively play a role in decisions that affect shareholder returns, such as dividend policies and the appointment of directors. They can also exercise the power to vote on acquisitions or mergers that may not improve profitability.

Next Steps:

It’s always worth thinking about the different groups who own shares in a company. But to understand Fortuna Silver Mines better, we need to consider many other factors. For instance, we’ve identified 2 warning signs for Fortuna Silver Mines that you should be aware of.

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.

NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures.